UK bookmaker Betfred has secured the acquisition of Betting World from Phumelela, through its newly-established South Africa arm.
The R120 million (£6.1 million) deal, subject to regulatory requirements concerning the transfer of shareholding in the company, was considered closed as of June 1st, 2021.
Speaking to Gambling Insider, “Betfred CCO Phil Siers said: “We are delighted to see the Betfred International service extended to South Africa, and look forward to becoming a leading South African bookmaker and providing a world-class service to all our new customers.
“The last 12 months have been difficult for all businesses, but Betfred is excited about the future of Betting World and intends to make a major investment in Africa over the coming years”.
The deal places Betfred in an excellent position to compete with the best South African casinos and is a huge step forward in becoming a global brand.
It was initially reported that the deal was first disclosed by Phumelela business rescue practitioner John Evans, who was leading the firm’s bankruptcy arrangements.
Phumelela Gaming and Leisure suspended its trading on the Johannesburg Stock Exchange (JSE) and filed for bankruptcy last summer. August auditor reports showed Phumelela had corporate debts of ZAR 677 million (€34m) and owed its creditors a total of ZAR 1.17 billion (€55m).
The company’s assets were placed under bankruptcy protection, and Phumelela sought additional investors, to avoid outright liquidation. As part of a business rescue plan, creditors also instructed Phumelela to place its South African race tracks up for sale.
Initially, Betfred co-founder and CEO Fred Done wished to purchase all of Phumelela’s race tracks for ZAR 875-to-925 million (€44-46m) but had to compete against a fund headed by two members of the Oppenheimer-Slack family, South Africa’s richest mining dynasty.
Mary Oppenheimer-Slack and her daughter Jessica Jell are racing enthusiasts and secured the racing tracks deal as existing creditors of the Phumelela’s business. This, despite the Betfred offer being significantly larger.
The Oppenheimer MOD (Mary Oppenheimer Daughters) fund had already issued ZAR 100 million before the deal, at the start of the pandemic, leading the auditors to accept the fund’s smaller ZAR 550 million plan.
Betfred’s plan had pledged to maintain all Phumelela employees and had hinged on the Manchester bookmaker’s strong record of operating racetracks – specifically the UK Tote, from 2011-2019.
However, the auditors felt that, as an existing creditor, The Oppenheimer MOD was the better option. It might not be the original proposition, but Betfred’s purchase of bettingworld.co.za still represents a major shakeup for the South African sports betting landscape, which has previously been restricted to domestic firms.
